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CA Foundation · Business Laws · The Limited Liability Partnership Act, 2008

Sunrise Analytics LLP was incorporated in Bengaluru. Its LLP agreement is silent on a few matters. In the absence of an agreement on the mutual rights and duties of the partners, which of the following applies under the LLP Act, 2008?

Where the LLP agreement is silent, the mutual rights and duties of the partners are governed by the First Schedule to the LLP Act, 2008. The Indian Partnership Act, 1932 does not apply to LLPs, and the Registrar does not fix these rights.

  1. AThe Indian Partnership Act, 1932 applies automatically to fill the gap
  2. BThe Companies Act, 2013 governs the mutual rights and duties
  3. CMutual rights and duties are governed by the First Schedule to the LLP ActCorrect
  4. DThe Registrar decides the rights and duties of each partner

Explanation

The LLP Act provides that where the agreement is silent, the mutual rights and duties of the partners and of the LLP are determined by the provisions in the First Schedule. The Indian Partnership Act does not apply to LLPs, which is why the first option is wrong.

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